Merck says employee reductions will begin 'later this year'

AP File Photo | MEL EVANSMerck's global headquarters in Whitehouse Station will likely lose some employees in the restructuring announced Friday.

Merck, the world’s second-largest drugmaker, said it will begin notifying employees about layoffs later this year as part of a restructuring announced Friday that will eliminate 13,000 of its 91,000 employees worldwide by 2015.

Steve Campanini, a spokesman for the company, said the company is currently "working through the process of notifying employees."

Downsizing will include some administrative staff and organizational support positions at its global headquarters in Whitehouse Station, Campanini said, but details about possible layoffs at the company’s research labs in Rahway or Kenilworth aren’t available.

Downsizing of this magnitude is common after mergers and usually happens very gradually, said John Challenger, CEO of Chicago outplacement firm Challenger, Gray & Christmas.

Friday’s announcement comes after the company eliminated 17,000 following its 2009 merger with Schering-Plough. Thirty-five to 40 percent of the newly announced cuts will occur in the U.S.

"You can think of some mergers like jigsaw pieces. Some just fit together perfectly," Challenger said, "but some are duplicates. And not only with product lines and sales forces, but it might be a whole IT department or a tax department. You don’t need two of those."

Merck’s announcement might conjure images of George Clooney’s character in "Up in the Air," a corporate downsizing expert who travels the country delivering the bad news to people who’ve been laid off.

Instead, large companies like Merck usually bring in strategic firms to help them plan their restructuring and determine how many positions they can afford to lose and how quickly.

"Once they’ve made the decision to go forward," he said, "they’ll bring in an outplacement company to help people find a job."

Campanini declined to say how many of the company’s 12,000 employees in the state will be impacted by the restructuring,

Aaron Fichter at the Department of Labor and Workforce Development hopes many of them will seek new employment in New Jersey.

"We have the largest cluster of pharamceutical biotechnology in the country and that’s a major competitive advantage for the state," said Fichter, the department’s assistant commissioner of labor planning and analysis.

The department schedules events at companies that announce large downsizings to teach employees how to access unemployment insurance and explore other employment options.

Although the department won’t act until it has received more information about how Merck’s restructuring will impact its New Jersey employees, Fichter said the department usually makes the first move when it comes to its rapid response efforts.